Understanding that life is sometimes a dance, you go forward one and back two and then three forward. Real estate has the same rhythm, and the dance we are dancing is the quick step with all movements being forward.
Statistics continue to support the increased activity each month in Brevard County, and those who snooze will lose in this market. The premium homes and condos for these bargain prices are now showing that the best of the best are being absorbed. Local Realtors agree the correction in this market is being seen with multiple offers on good properties and some scarcity of listings in a few neighborhoods.
Financing still is the difficult part of the transaction and many cash buyers are showing their strength in selecting the values and knowing they can move forward quicker than others. The cash buyer controls the best transactions.
Appraisals continue to be the problem, with many of our local lenders using out-of-town appraisers. It is understood that appraisers are bidding for these jobs and lowering prices to be competitive. The out-of-town appraisal groups are undercutting the locals and capturing the jobs. Interesting that the cost does not appear to be passed on to the consumer. It is no wonder appraisals appear to show inconsistencies in the competitive properties selected.
The appraisers who are not in this market do not know which neighborhoods are considered comparable. Can the borrower insist on a local appraiser?
This appraisal problem, apparent in our area, does not appear to benefit the lender as many new loans are lost due to the low appraisals. Refinancing is effected in the same manner.
The lending institutions with strong local leadership will find a way to change this procedure and create the fairness this market deserves. For the first time in several years, it has been reported that developers are now coming into the market to capture the value of vacant land that is prime for new construction.
With the planning and permitting time period needed for development, the time may be right for land transactions to begin to show a significant increase in activity.
With a two- to three-year absorption rate for residential homes and the necessary time needed to prepare and plan for a development, it would be wise for developers to begin to take advantage of the low land prices and plan for the next several years.
As the hot summer sun beats on Brevard County, let the rhythm of the dance continue.
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